Tuesday, March 24, 2009

Leadership: What it takes to get through Tough Times



Every now and then I check out Bill Marriott's blog. Yes, Bill Marriott as in Courtyard Marriott and Renaissance Marriott, etc. In today's comments, he talks about commitment, and leadership, and what it takes for a businessperson to get through these times and come out stronger and perhaps well ahead of competition. Here is an edited version:

"I've been through eight recessions in my lifetime and, while this one feels deeper and less predictable, I've learned what companies like Marriott need to do to come out strong. Cost cutting is obviously the key to survival today. But the wrong kind of cuts will delay a comeback and erode our competitive position. We need to invest in people, product and service innovation that will reap benefits in the future.

With fewer people checking into our hotels, we've been forced to eliminate some positions. For me, that's the toughest part of the job. I believe sacrifices must be shared and so I've informed the Marriott Board of Directors that I will decline two thirds of my compensation in 2009. All of our senior executives are seeing significant decreases in their compensation as well.

As we think about strength and vitality going forward, I'm also proud to announce some shifts in our management structure that I believe will put us in the strongest position for the future. Effective May 1, Bill Shaw, our current President and COO will become Vice Chairman of the corporation overseeing Global Finance, Owner and Franchise Services, Architecture and Construction, Information Resources and will be Chairman of our Corporate Growth Committee. In his 34 years with Marriott, Bill Shaw has provided tremendous leadership, especially during the past 12 years when he oversaw global operations across all of Marriott's brands. Bill has assembled a first rate management team with expertise second to none in our industry. He has been at my side through recessions in the '80s, the '90s and again in 2001. His wise financial judgment was and continues to be invaluable.

Arne Sorenson, our current CFO and President for European Lodging will be promoted to the position of President and COO, effective May 1. Since joining Marriott 12 years ago, Arne has rapidly emerged as one of the top senior executives in the hospitality industry. He has shown tremendous range and success across a wide scope of disciplines that positions him uniquely for a larger leadership role in our company at a time when both the challenges and opportunities for growth are terrific. In his new role, he'll be responsible for the performance and growth of our brands and businesses throughout the world.

Carl Berquist, currently Executive VP, Financial Information and Enterprise Risk Management, will become CFO, reporting to Bill Shaw. Carl joined Marriott in 2002 after a brilliant career at Arthur Anderson.

The steps we are taking today are important and will put Marriott in the strongest position for a successful future. In these unprecedented times, the company is fortunate to have extraordinary executives who will expand our industry leadership and drive long-term opportunity and growth.

This economy provides a tough environment for any company. But it's a wonderful environment for learning. Over the years, Marriott has assembled a fine team of top executives with tremendous scope and range through a process of rotating them through every part of the business. In fact, our success with this leadership development strategy is profiled in the current issue of the Harvard Business Review.

This economy puts all of us to the test. And yet, I am confident we have the people, the places and the sense of purpose that will prevail. On Inauguration Day, we took out an ad in USA Today to mark the historic presidency of Barack Obama. It listed all the conventional wisdom that has been proven to be wrong in our history:

  • That you can't abolish slavery.
  • That you can't give women the right to vote.
  • That you can't fly an airplane from New York to Paris.
  • That you can't cure polio.
  • That you can't put a man on the moon.
  • That you can't beat the Russians in hockey.
  • That you can't elect a black man President of the United States.

But we said, "Yes we can!"

That's how I feel now. We're at a crossroads. Things are tough. But when it comes to building a better future, with more opportunity for our associates to welcome millions of guests at more than 3,100 beautiful hotels around the world, I know the answer is: Yes we can!
I'm Bill Marriott and thanks for helping me keep Marriott on the move."

Sunday, March 22, 2009

Spring time is Scooter time

Colt's Foot has just started to appear in certain areas around NE Ohio. It's a sure harbinger of Spring. Took this today while on a hike in O'Neill Woods. From the rocks you can guess it's close to a river. The river happens to be the Cuyahoga.

After spending hours inside today, painting our living room, the lure of warm air and sunshine took hold. The first warmish day this spring inspired me to roll my scooter out to the driveway from behind three bicycles and a bucket of cleaning supplies. I topped off the oil, added a 1/2 gallon of fresh gasoline, wiped the dust off the helmet, put on some warm gloves and my jacket, and away I went. Me and my Vespa took a quick spin around the block. That's my pink Power Ranger jacket. Wear it every time I ride my scooter, even when I'm in a dress or skirt. The one really warm day that I neglected to wear it, I was stung on my chest by some unknown stinger creature. By the time I got to my office, the critter was gone, but it's stinger remained. The stinger was a good inch-long. Within 8 hours, I had a 12 inch area of beet-red, swollen skin. The effects of the sting lasted about 5 days, most of which I spent out of town on business, in open-collar-type shirts. Not an attractive look. So, I wear the jacket.


I have to remember to check the air in my tires. They were up on blocks most of the winter, so the tires should be good. Not sure about tire pressure.



Friday, March 20, 2009

News from the Aftermarket Wire

R.L. Polk & Co. recently released the results of its market study, titled, "The Changing U.S. Auto Industry - the Impact of Declining New Vehicles Sales on the Aftermarket Business"

In today's AMN, we reported, "As the economic crisis continues and consumers shy away from purchasing vehicles, drivers will hold onto their vehicles longer. In fact, the average length of ownership of both new and used vehicles has increased from 37.2 months in 2002 to 46.3 months in 2008, an 24% increase.

While this increase in average length of vehicle ownership is not good for automakers and dealerships that sell new vehicles, it's positive news for many segments of the automotive aftermarket. Many segments will benefit from increases in the number of older vehicles on the road, especially those in the 11+ age group. As partial proof, stocks for aftermarket repair chains O'Reilly automotive, Advance Auto Parts, and AutoZone have shown strong results so far in 2009.

Polk recently studied U.S. consumers on vehicle purchase plans. 64% of consumers said they were "very or extremely likely" to keep their current vehicle longer than they normally would due to current economic conditions. Additionally, 81% of the 713 interviewed vehicle owners in this same study also said they planned to take better care of their vehicle to keep it running longer, which could translate to additional aftermarket revenue.

As the number of older vehicles on the road climbs and consumers focus more on vehicle maintenance, the aftermarket must be ready to meet the increased need for parts and service, which has implications for inventory management planning. Also, as consumers continue to look for ways to cut costs, retailers targeting DIYers and, to a lesser extent, independent aftermerket repair facilities could stand to gain additional share of market."

After reading this, here's my first thought - does this mean the retailers will expand their DIY section of automotive? For instance, right now Target carries primarily appearance chemicals, wiper blades, car accessories, and fuzzy-dice-type stuff. I haven't been in a K-Mart, TSC or WalMart for years to see their automotive section - so I'm not sure what they carry.

But if this information is true, isn't now a good time to go back to the retailers and sell them the tools and equipment that DIYers will need to perform more of their own work? In addition to the pickup you should start seeing in your traditional markets, this unique situation in the aftermarket provides an incredible opportunity for some tool or equipment manufacturers to branch out into new markets.

You can read the entire 28-page report by going to www.aftermarketnews.com.

Monday, March 16, 2009

Quick Update on Tool Shows

Laguna Beach, looking south.
David Bonitz, Silvertronics' Director of Sales for North America, shows off the quality of one of his leads to a Cornwell Dealer.
Patrick Gottsch, of CRKT (Columbia River Knife and Tool) had a great display. Knives are a hot item with mobile distributors.
Bill Stemple, VP of Marketing for Cornwell, reviews some of the new features of this Cornwell toolbox.


Spent last week in the West: first half of the week in Las Vegas for the Matco Show, second half in southern California (mostly Anaheim) for the Cornwell Show. Here's the 25 second review:

1 - LOTS of positive comments about business in general at both shows.

2 - was told by Matco personnel that they had strung two months of positive sales together and expected April to continue the trend

3 - was told by Cornwell management that their dealers are paying their bills on time and that technicians are (finally) getting financing.

4 - many manufacturers reported dismal sales since last Oct or Nov, but many were starting to see an uptick in orders. Some of this uptick came in February, some didn't start 'til March
5 - Santa Monica Beach has an interesting pier if you like touristy spots, but Laguna has a prettier beach.
Up is up. I'll take it. More info to follow later in the week.

Thursday, March 5, 2009

Short Note Today


One day ahead of hearing it from everyone in your office, let me remind you that we Spring Forward this weekend. I can't remember if that means we gain an hour or lose an hour. And it doesn't really matter to me because I'll be flying 3 (or will it be 2) hours back in time to Las Vegas on Sunday morning. All I know for sure is that I'll be swapping our old batteries for new in every one of our smoke detectors. (Confidential to First Alert: Your marketing efforts worked on this household!)










This weekend the Matco Tool Fair begins. Next weekend I'll be off to Anaheim for the Cornwell Tool Rally. I've heard through the "grapevine" that Matco expects about 800-850 dealers and Cornwell has about 350 registered. Don't quote me on that though. As usual, I'll post everything new and exciting from the show once I get back.

In other news, at TechShop, we've been working on a new website. It will officially launch April 1, 2009, but you'll be able to see it earlier, by March 16th. Please bookmark the site, because my blog will be moving there and this blog will become inactive. I would hate to lose the few followers I have. http://www.techshopmag.com/ I'll remind you again later. We are also launching an all-new design for the magazine with our April issue. Guarantee you will LOVE it! It makes our competitors' efforts look like grade school scribbles. (Just my opinion.)

It was sunny for about a minute here today and it's starting to warm up finally. The clouds are coming in as I write this, and soon we'll endure a day and a half of rain. Nonetheless, I'm feeling optimistic. I was doing quite a bit of research this morning, and I think it's safe to say that portions of our economy are starting to see a pickup. Walmart and Sam's Club reported a sales increase of 5.1% for this February over last February. And ASA reported that a survey of 8,000 shop owners in 2008 reported a business increase of 16%. Perhaps Spring really is right around the corner, and perhaps the Recession is waning towards Recovery. I will definitely know more about what our automotive compatriots opinions are after next week.
Stay tuned!

Wednesday, March 4, 2009

Utterly Useless Trivia


I should save this for a Friday afternoon, but just can't. I am a trivia-junkie. If you are playing Trivial Pursuit, you want me on your team. So, here's some trivia I recently re-discovered:
Category: Science

The speed of sound has often been exceeded by what man-made object that predates flight by hundreds of years?
A: The crack of a whip is the tip exceeding the speed of sound, creating a mini-sonic boom.


Category: History

Where has anyone been able to recieve a free mug of beer and a slice of bread from, since 1136?A: The Wayfarer's Dole is a tradition of the Hospital of the Holy Cross, in Winchester, England

What was the average speed of Lee Petty's 1959 Oldsmobile when he won the first Daytona 500 in 1959?
A: 135.5 mph, finishing the 200-lap race in 3 hours, 41 minutes.

Why is a toy rubber ball enshrined in the Super Bowl section of the Pro Football Hall of Fame?
A: His kid's Wham-O Superball inspired Lamar Hunt to coin the term Super Bowl.


Category: Science

During the winter, you can glide through Ottawa, Canada on the world's longest skating rink. What is it and how long is it?
A: The frozen Rideau Canal. It is 7.8 km (4.5 miles)

What environmental catastrophe left 20 dead and thousands suffering in 1948?
A: An inversion trapped deadly smog over Denora, PA.


Category: Finance

Recessions have many causes. How did a virus trigger the Panic of 1873?
A: The economy collapsed when a virus infected 99% of the horses in America.

What was the first item sold on eBay?
A: Pierre Omidyar sold a broken laser pointer in 1995 for $14.